{"id":163031,"date":"1998-11-19T00:00:00","date_gmt":"1998-11-18T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/ms-rickmers-verwaltung-gmb-h-vs-the-indian-oil-corporation-ltd-on-19-november-1998"},"modified":"2016-01-27T03:09:00","modified_gmt":"2016-01-26T21:39:00","slug":"ms-rickmers-verwaltung-gmb-h-vs-the-indian-oil-corporation-ltd-on-19-november-1998","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/ms-rickmers-verwaltung-gmb-h-vs-the-indian-oil-corporation-ltd-on-19-november-1998","title":{"rendered":"M\/S Rickmers Verwaltung Gmb H vs The Indian Oil Corporation Ltd on 19 November, 1998"},"content":{"rendered":"
Supreme Court of India<\/div>\n
M\/S Rickmers Verwaltung Gmb H vs The Indian Oil Corporation Ltd on 19 November, 1998<\/div>\n
Author: . A.S.Anand.<\/div>\n
Bench: K.Venkataswami<\/div>\n
           PETITIONER:\nM\/S RICKMERS VERWALTUNG GMB H\n\n\tVs.\n\nRESPONDENT:\nTHE INDIAN OIL CORPORATION LTD.\n\nDATE OF JUDGMENT:\t19\/11\/1998\n\nBENCH:\nK.VENKATASWAMI\n\n\n\n\nACT:\n\n\n\nHEADNOTE:\n\n\n\nJUDGMENT:\n<\/pre>\n
 JUDGMENT
\nDr. A.S.Anand. CJI
\nLeave granted.\n<\/p>\n
This appeal by special leave calls in  question\t the
\njudgment  and  order  of the Delhi High Court dated Oct. 17,
\n1996 and arises in the following circumstances.
\nThe respondent, Indian Oil Corporation Ltd., entered
\ninto an agreement with M\/s Tubacero of Mexico  for  purchase
\nof   pipes  for\t its  Kandla-Bhatinda  Pipeline\t project  on
\nSeptember 16,  1993.\tAccording  to  the  terms   of\t the
\nagreement,  M\/s\t Tubacero  were\t to deliver the pipes to the
\nrespondent at Tampico Port in Mexico.  In order to bring the
\npipes to India, the respondent,\t a  Government\tCorporation,
\nwas  required  to go through M\/s Transchart, a department of
\nthe Ministry of Surface\t Transport,  which  brokers  charter
\nparty  arrangements  with  various  vessel  owners,  for the
\npurposes of shipping  of  pipes\t from  Tampico\tPort.\t M\/s
\nTranschart  invited  offers from various ship owners and the
\nappellant was one of the ship owners who made an offer.\t  In
\norder  to execute a contract between the parties, respondent
\nNo.  1 was to establish a standby letter of  credit  as\t per
\nthe  format  to be mutually agreed upon by the parties while
\nthe appellant was to furnish a performance bond\t also  in  a
\nformat\tto  be\tmutually  agreed  upon\tby both the parties.
\nRespondent No.\t1 conveyed to the appellant  on\t Nov.\t 17,
\n1993  that  loading of pipes at Tampico port should commence
\non December 14, 1993 and be completed by December 21,  1993.
\nThe  appellant,\t however,  did\tnot  proceed  in  the matter
\nbecause the format and the language of the standby letter of
\ncredit in the form issued by its bankers was not approved by
\nthe first respondent.  The draft letter of  credit  proposed
\nby  the\t first\trespondent  was\t also  not  approved  by the
\nappellant and fresh proposals  were  exchanged\tbetween\t the
\nparties.   As a consequence, the appellant did not carry the
\npipes, as according to it.  the formats of standby letter of
\ncredit and performance guarantee were  not  settled  between
\nthe parties.  The first respondent was, therefore, compelled
\nto  arrange  for  the carriage of first consignment of pipes
\nreceived from M\/s Tubacero at  Mexico.\t  Trnaschart  by  it
\ntelex  dated  December 24, 1993 apprised the appellant about
\nthe failure to carry out its  obligation,  despite  repeated
\nrequests  which\t had  resulted in the Charterers to finalise
\nalternative shipping arrangements.  While the  matter  stood
\nthus, the appellant filed a request for arbitration with the
\nIndian Council\tof  Arbitration\t on  11.6.1994.\t On June 28,
\n1994 the first respondent received a notice from the  Indian
\ncouncil\t of Arbitration intimating it that the appellant had
\nfiled an application dated June 16, 1994 invoking Clause  53
\nof   the   Agreement  of  Affreightment\t (AOA)\trelating  to
\narbitration and that it had laid a claim of 1,031,668.77  US
\ndollars.  The first respondent was directed to deposit a sum
\nof Rs.\t  83,200\/-  towards  costs  of the arbitration on or
\nbefore July 28, 1994.  On receipt of the communication\tfrom
\nthe  Indian  Council  of  Arbitration,\tthe first respondent
\ninformed  the  Indian\tcouncil\t  of   Arbitration   (second
\nrespondent)  that  there  did not exist any binding contract
\nbetween the first respondent and the  appellant,  much\tless
\nany  binding  agreement\t of  refer  any\t dispute between the
\nparties\t to  arbitration  according  to\t the  Rules  of\t the
\nArbitration of\tthe  Indian  Council of Arbitration.  It was
\nasserted that the agreement dated Nov.\t11, 1993 relied upon
\nby the appellant in its statement of claim, as\tconstituting
\nthe  contract between the parties had not been signed by the
\nfirst respondent and the document was nothing  more  than  a
\nmere  proposal\tmade  by the appellant, which was subject to
\nthe parties agreeing on\t the  format  and  language  of\t the
\nstandby\t letter\t of  credit  to\t be  provided  by  the first
\nrespondent for the benefit of the appellant and was  subject
\nto  the\t parties also agreeing to the format and language of
\nperformance guarantee to be established by the appellant  in
\nfavour of  the\tfirst  respondent.    It was maintained that
\nsince no agreement could  be  reached  with  regard  to\t the
\ncontents   of\tthe  aforesaid\ttwo  documents,\t which\twere
\nfundamental to arrive at a working relationship between\t the
\nparties, the claim of the appellant regarding the conclusion
\nof the\tcontract  between  them\t was  not maintainable.\t The
\nfirst respondent also questioned  the  jurisdiction  of\t the
\nIndian\tCouncil\t of  Arbitration to decide whether or not an
\narbitration  agreement\texists\tbetween\t the   parties\t and
\nasserted that in case the appellant considered that they had
\nentered\t into  a binding agreement between the parties, they
\ncould take steps to obtain a reference through\ta  competent
\ncourt.\t Notwithstanding  the stand of the first respondent,
\nthe Indian  Council  of\t Arbitration  on  January  3,  1995,
\nintimated   to\t the  parties  that  it\t had  appointed\t Mr.
\nM.K.Chawla a retired Judge of the Delhi\t High  Court  as  an
\nArbitrator.   It  was  also stated in the communication that
\nappellant had nominated Rear  Admiral  (Dr.)  O.P.Sharma  as
\ntheir nominee  as  arbitrator.\t  The  first  respondent was
\nrequested to file its statement of defence  by\tJanuary\t 15,
\n1995, which  date  was subsequently extended.  The direction
\nto deposit a sum of Rs.\t 83,000\/- towards cost\tof  expenses
\nof the\tarbitration  was  reiterated.  The first respondent,
\naggrieved by the communication from the\t Indian\t Council  of
\nArbitration  dated  January  3, 1995, filed a petition under
\nSection 33 of the Indian Arbitration Act,  1940,  seeking  a
\ndeclaration  from  the\tcourt  that  there did not exist any
\nconcluded arbitration agreement between the parties and\t the
\nreference  of  the dispute in question to the Arbitration by
\nthe appellant was unwarranted and  not\tmaintainable.\t The
\napplication  was  resisted  by the appellant, who maintained
\nthat a valid and subsisting agreement  between\tthe  parties
\nhad  come into existence and that the claim of the appellant
\nwas required to be adjudicated by the arbitrators  in  terms
\nof Clause  53  of  the “agreement”.  On the pleadings of the
\nparties, a learned single Judge\t of  the  Delhi\t High  Court
\nframed the following issues :\n<\/p>\n
\t     “1.Whether there is a valid and
\n\t     subsisting agreement between the
\n\t     parties ?\n<\/p><\/blockquote>\n
\t     2.Relief.”\n<\/p><\/blockquote>\n
During the pendency of the application\tthe  learned
\nsingle\t Judge\t stayed\t  further   proceedings\t before\t the
\nArbitrator appointed by the Indian Council  of\tArbitration.
\nParties\t were directed to file evidence by way of affidavits
\nin the court.\t documentary  evidence\tand  affidavit\twere
\nconsequently filed in the court.\n<\/p>\n
The case put up before the learned single  Judge  on
\nbehalf\tof  the\t appellant  was that though no agreement (as
\ndrawn up on 11.11.1993)\t was  formally\tsigned\tbetween\t the
\nparties,  yet  the  contemporaneous correspondence exchanged
\nbetween them went to show that a binding contract  did\tcome
\ninto  existence\t between  the parties and since Clause 53 of
\nthe “agreement” dated 11.11.1993 provided that all  disputes
\nunder  the  Charter  Party  were  to  be settled in India in
\naccordance with the provisions\tof  the\t Indian\t Arbitration
\nAct,  1940  read  with the Maritime Arbitration Rules of the
\nIndian Council of Arbitration, their plea to get the dispute
\nsettled by arbitration\twas  well  founded.    According  to
\nrespondent No.\t1, Indian Oil corporation Ltd., on the other
\nhand, no arbitration agreement had been executed between the
\nparties\t  and\tthat   the   contemporaneous  correspondence
\nexchanged between the parties had also not brought about any
\nenforceable contract between them  because  the\t fundamental
\nconditions  of\tthe terms of the bargain were neither agreed
\nupon nor fulfilled by the parties.\n<\/p>\n
After\t referring    to   various   documents\t and
\ncorrespondence exchanged between the  parties,\tthe  learned
\nsingle\tJudge  on  October  17,1996, vide the order impugned
\nherein, held that  on  concluded,  enforceable\tand  binding
\ncontract came into existence between the parties and as such
\nClause\t53  of\tthe  Charter  Party  “agreement” relating to
\narbitration had no existence in the eye of law.\t  Issue\t No.
\nI was,\taccordingly,  decided in favour of respondent No.  1
\nand the petition filed under Section 33 of  the\t Arbitration
\nAct by\trespondent No.1 was allowed on October 17,1996.\t The
\nlearned\t single\t Judge\t restrained   the   appellant\tfrom
\nproceeding with the arbitration.  Hence this appeal.
\nWe  have  heard\t learned counsel for the parties and
\nperused the record.\n<\/p>\n
It is an admitted case of the parties that a Charter
\nParty Agreement was drawn up on November 11, 1993.   It\t is,
\nhowever, not disputed that the said agreement was not signed
\nby the parties.\t   Mr.\tR.F.Nariman, learned senior advocate
\nappearing for the appellant submitted that even\t though\t the
\nagreement dated November 11, 1993 had not been signed by the
\nparties\t but the parties had acted upon it treating it to be
\na binding contract.  Argued Mr.\t Nariman that the  agreement
\nwas  operative\tand  binding even without the parties having
\nagreed to the format and terms\tof  the\t standby  letter  of
\ncredit\tand the performance guarantee, because the appellant
\nhad after receipt of the letter of  credit  from  respondent
\nNo.1  sent  to\thim  a\tcommunication dated December 6, 1993
\nintimating that the draft of letter of credit was  basically
\nacceptable except for some minor details.  Similarly, it had
\nbeen  eonveyed\tthat  the  draft  performance bank guarantee
\nreceived by it from respondent No.1 had\t been  forwarded  to
\nthe bankers  for  their acceptance.  Learned counsel pointed
\nout that on December 16,1993, Transchart had faxed  a  fresh
\ndraft  of  standby  letter of credit to the appellant and in
\nthe communication attached thereto, it\twas  indicated\tthat
\nthe draft letter of credit would be acted upon by respondent
\nNo.1 On\t this  basis,  Mr.  Nariman submitted that a binding
\nagreement had come into existence,  through  correspondence,
\nand  the  non-signing  of  the charter party agreement dated
\nNovember 11,1993 by respondent No.1 was of  no\tconsequence.
\nMr.   Nariman  asserted\t that Clause 48 of the agreement did
\nnot speak of any agreement regarding the terms of letter  of
\ncredit\tto  be forwarded by State Bank of India or regarding
\nthe format and language of the performance guarantee  to  be
\nestablished   by  the  appellant  in  favour  of  the  first
\nrespondent,  and  therefore,  even  in\tthe  absence  of  an
\nagreement  about  the  format of the letter of credit and of
\nthe performance guarantee, Clause 48 of\t the  agreement\t was
\nattracted and recourse to arbitration was justified.
\nLearned\t counsel  for  the   respondent\t  in   reply
\nsubmitted  that\t perusal  of  the  correspondence  exchanged
\nbetween the parties established that there was no meeting of
\nmind between the parties and  no  agreement  could  also  be
\nspelt  out  from  the  correspondence  exchanged between the
\nparties.  Learned counsel submitted,  by  reference  to\t the
\ndocuments  on  the record, that the correspondence exchanged
\nbetween the parties, including various fax messages, exposed
\nthat the appellant was not ready to nominate the  vessel  to
\ncarry the cargo, without agreeing on the terms of the letter
\nof  credit  and the performance guarantee and that there was
\nno letter or fax exchanged between the parties\twhich  could
\nin  any\t manner indicate that any agreement had been arrived
\nat between the parties with  regard  to\t the  terms  of\t the
\nstandby\t letter\t of  credit  and  the performance guarantee.
\nSince, the appellant itself attached primary  importance  to
\nthe  furnishing\t of letter of credit by the first respondent
\nbefore it  could  carry\t the  cargo  submitted\tthe  learned
\ncounsel,  the “draft” Charter Party agreement dated November
\n11,1993 even if it had in fact\tbeen  executed\tbetween\t the
\nparties,  could\t not become enforceable because the terms of
\nletter of credit and  performance  guarantee  had  not\tbeen
\nagreed to between the parties.\n<\/p>\n
\tIt  would  at  this  stage  be\trelevant  to extract
\nsub-clause (a) of Clause 48 to the Charter Party.  It  reads
\nthus:-\n<\/p>\n
\t   “4(a) Freight is payable :-\n<\/p><\/blockquote>\n
\t   IOC\twill open a standby irrevocable Letter of
\n\t   Credit for freight amount of each shipment for
\n\t   the cargo  in  transit.    Standby  Letter  of
\n\t   Credit  will\t be  issued  by\t SBI India on SBI
\n\t   Germany.  Freight payment will be made through
\n\t   Bank Transfer at Hamburg Germany  under  which
\n\t   50  percent\tless  3.75  percent commission is
\n\t   payable  within   7\t working   days\t  against
\n\t   presentation\t of  copy  Bill\t of  Landing  and
\n\t   owners invoice  in  triplicate.    40  percent
\n\t   within  7  working  days  of\t saft  arrival of
\n\t   vessel  at  disport\tand  on\t presentation  of
\n\t   owners  invoice  in\ttriplicate and 10 percent
\n\t   within 30 days of completion of discharge  and
\n\t   on\tpresentation   of   owners   invoice   in
\n\t   triplicate”.\n<\/p><\/blockquote>\n
A  bare\t reading  of Clause 48 (supra) shows that respondent
\nNo.1 was to open a standby irrevocable letter of credit\t for
\nfreight\t amount\t of  each  shipment of the cargo in transit.
\nThe standby letter of credit was required to  be  issued  by
\nthe  State  Bank  of  India  on\t the  State Bank of Germany.
\nIndeed this clause by  itself  does  not  show\twhether\t the
\ncondition  of  establishing  a standby irrevocable letter of
\ncredit or  the\tfurnishing  of\tperformance  guarantee\twere
\nconditions precedent to the conclusion of contract but there
\nis  enough  material  on  the  record to show that they were
\nmeant to be condition  precedent.    In\t this  connection  a
\nreference  may\tbe  made  to  the  fax\tcommunication  dated
\n4.11.1993  from\t the  appellant\t (much\tbefore\tthe  alleged
\nagreement of November 11,1993) which reads thus :-\n<\/p>\n
\t   “frt-payment :    100 pct secured by bank gtee
\n\t   in favour of Line  account  at  hamburg  under
\n\t   which  50  pct  less\t 3.75  pct  commission is
\n\t   payable  within  seven  working  days  against
\n\t   presentation\t of  original  bladings and Lines
\n\t   invoice in triplicate.  $0 pct within 35  days
\n\t   of  date  of\t bill  of lading 10 pct within 60
\n\t   days of date of bill of lading.
\n\t   (in\torder  to avoid any dispute and documents
\n\t   to be furnished we have to relate to one  firm
\n\t   document  which is bill of lading and one firm
\n\t   date which is date of bill of lading).
\n\t   Line to provide charters with performance gtee
\n\t   equivalent  to 5 pct of freight bases on appr.
\n\t   10,000  mt  per  shipment  equivalent  to  usd
\n\t   50,000  firm\t valid\ttill  40  pct  payment is
\n\t   released.\n<\/p><\/blockquote>\n
\t   Formate of bank gtee and performance bond gtee
\n\t   to mutually\tagreed.\t   Specification of cargo
\n\t   noted however quantity now  abt.    50,000  mt
\n\t   only.   In  case  of\t 7 shipments quantity per
\n\t   shipment 7,000 mt only.  Kdly advise as  cargo
\n\t   quantity major factor for freight calculation.
\n\t   Pls\tAdvise\turgently till office opening tom.
\n\t   Morning here.  Will reply  on  c\/p-terms  tom.
\n\t   Afternoon.”\n<\/p><\/blockquote>\n
and the fax message sent by respondent No.1.  on 10.11.1993:\n<\/p>\n
\t   “tradex  newdelhi  10.11.1993 attn: mr wersich
\n\t   line pipes-tampico\/kandla  received\tfollowing
\n\t   from chrts:\n<\/p><\/blockquote>\n
\t   1.period  – to be changed to dec 1993 to july
\n\t   1994 (however everything else reg qtty \/  lots
\n\t   remains same)\n<\/p><\/blockquote>\n
\t   2.in place of bank gtee –\n<\/p><\/blockquote>\n
\t   “ioc\t will  open a standby irrevocable 1\/c for
\n\t   freight amount of one shipment for  the  cargo
\n\t   in  transit. Standby l\/c will be issued by sbi
\n\t   india on sbi germany. Freight payment will  be
\n\t   made\t through bank transfer at hamburg germany
\n\t   under  which\t 50%  less  3.75%  commission  is
\n\t   payable   within   7\t  working   days  against
\n\t   presentation of  b\/1\t and  owners  invoice  in
\n\t   triplicate.\t40  pct\t within 7 working days of
\n\t   safe arrival of vsl\tat  disport  and  10  pct
\n\t   within 30 days of completion of discharge.\n<\/p><\/blockquote>\n
\t   3.the  ship\tname\/details should be intimated
\n\t   immediately. End plse confirm your  acceptance
\n\t   to above per return.”\n<\/p><\/blockquote>\n
The  return  fax message from the appellant dated 10.11.1993
\nreads:\n<\/p>\n
\t   “refyr msg of just now :\n<\/p><\/blockquote>\n
\t   1.accepted\n<\/p><\/blockquote>\n
\t   2.ioc will open a standby irrevocable 1\/c  in
\n\t   regard   to\t the   freight\t amount\t for  the
\n\t   shipments.  Funds under 1\/c for each lot to be
\n\t   available by latest 15th of each month  before
\n\t   nomination of the vessel by line.  Standby 1\/c
\n\t   will\t br  issued  by sbi india on sbi germany,
\n\t   sbi Germany\tto  be\tauthorised  to\treimburse
\n\t   themselves.\tIn case any freight amount is not
\n\t   being   received   by  line\tas  per\t c\/p  and
\n\t   mentioned below, the amount shall be\t released
\n\t   on  first  written  demand  under  standby 1\/c
\n\t   freight payment  will  be  made  through  bank
\n\t   transfer at hamburg germany:
\n\t   a.50% less 3.75% commission is payable within
\n\t   7 days on prersaa, 29,90: 2 nos. copy bill  of
\n\t   lading Lina’s invoice in triplicate
\n\t   b.40%   is\tpayable\t  within   7   days   on
\n\t   presentation of : arrival notice  from  master
\n\t   (telegram\/telex\/telefex)
\n\t   c.10%   is\tpayable\t  within   30\tdays  on
\n\t   presentation of : discharge notice from master
\n\t   (telegram\/telex\/telefex)\n<\/p><\/blockquote>\n
\t   3.require urgently all detls of Ist lot  (see
\n\t   Y’  days telex) before, we cannot niminate the
\n\t   vessel. Entd
\n\t   comments:\n<\/p><\/blockquote>\n
\t   in case point 2 not clear, kdly call in  order
\n\t   to discuss the possibilities over phone. Tks.
\n\t   Lifting  extended  to  12.30\t hrs  german time
\n\t   tomorrow.\n<\/p><\/blockquote>\n
\t   Looking forward to hearing from you.”\n<\/p><\/blockquote>\n
This  correspondence  unmistakably shows that at no point fo
\ntime, till the charter party agreement was drafted  on\t11th
\nNov.  1993  did the parties agree to proceed further without
\nagreeing upon  the  format  of\tthe  letter  of\t credit\t and
\nperformance guarantee.\n<\/p>\n
Reference  here\t may also be made to the fax message
\ndated December 16, 1993, by which a fresh draft\t of  standby
\nletter\tof  credit  was sent by Transchart to the appellant.
\nIn that fax message it was indicated that the  draft  letter
\nof credit  would  be  acted  upon  by  the  appellant.\t The
\nresponse of the appellant’s agent, Line International of the
\nsame date, however, shows that it was categorically asserted
\nby it that the draft letter of credit was not  workable\t and
\ntherefore, was not acceptable.\tLine International had faxed
\ndraft of  a  fresh  standby letter of credit.  Subsequently,
\nanother draft of standby letter of credit was also faxed  by
\nLine   International   but  since  there  was  no  agreement
\nregarding the acceptance of the draft, the appellant did not
\nnominate  any  vessel  for  carrying  the  cargo  which\t was
\nrequired to be loaded from December 14, 1993 to December 21,
\n1993.\tLine  International  had  consistently maintained in
\ntheir various fax messages,  that  the\toffer  made  by\t the
\nappellant  was subject, inter alia, to the acceptance of the
\ndraft letter of credit.\t The stand of the appellant was thus
\ncategorical that without any agreement on the terms  of\t the
\nletter of credit, it was not ready to nominate the vessel to
\ncarry the  cargo.    The appellant was, thus, for all intent
\nand purposes treating the furnishing of the letter of credit
\nas a condition precedent for carrying  the  cargo.    At  no
\npoint  of  time\t did  the  appellant accept the terms of the
\nletter of credit furnished by respondent No.1.
\nThe submission of Mr.  Nariman\tthat  an  agreement,
\neven  if  not  signed  by the parties, can be spelt out from
\ncorrespondence exchanged between the parties  admits  of  no
\ndoubt.\tIn  fact,  various judgments cited by him at the bar
\nunmistakably support this assertion. The question,  however,
\nis  can\t any  agreement be spelt out from the correspondence
\nbetween the parties in the instant case ?\n<\/p>\n
In  this  connection  the  cardinal   principle\t  to
\nremember  is  that  it\tis the duty of the court to construe
\ncorrespondence with a view to arrive at a conclusion whether
\nthere was any meeting of mind  between\tthe  parties,  which
\ncould  create  a binding contract between them but the Court
\nis not empowered to create a contract  for  the\t parties  by
\ngoing outside the clear language used in the correspondence,
\nexcept insofar as there are some appropriate implications of
\nlaw to\tbe  drawn.    Unless  from the correspondence it can
\nunequivocally and clearly emerge that the  parties  were  ad
\nidem  from  that  material to infer whether the intention as
\nexpressed in the correspondence was to bring into  existence
\na mutually  binding  contract.\tThe intention of the parties
\nis to be gathered only from  the  expressions  used  in\t the
\ncorrespondence\tand  the  meaning  it conveys and in case it
\nshows that there  had  been  meeting  of  mind\tbetween\t the
\nparties and they had actually reached an agreement, upon all
\nmaterial  terms,  then\tand then alone can it be said that a
\nbinding contract was capable of being  spelt  out  from\t the
\ncorrespondence.\n<\/p>\n
From  a careful perusal of the entire correspondence
\non the record, we are  of  the\topinion\t that  no  concluded
\nbargain had been reached between the parties as the terms of
\nthe  standby letter of credit and performance guarantee were
\nnot accepted by the respective parties.\t In the\t absence  of
\nacceptance  of\tthe standby letter of credit and performance
\nguarantee by the parties, no enforceable agreement could  be
\nsaid to\t have  come  into  existence.\t The  correspondence
\nexchanged between the parties shows that  there\t is  nothing
\nexpressly  agreed  between  the\t parties shows that there is
\nnothing expressly  agreed  between  them  and  no  concluded
\nenforceable   and  binding  agreement  come  into  existence
\nbetween them.  Apart from the correspondence relied upon  by
\nthe learned single Judge of the High Court, the fax messages
\nexchanged  between the parties, referred to above go to show
\nthat the parties were only negotiating and had\tnot  arrived
\nat any\tagreement.    There  is\t a  vast  difference between
\nnegotiating a bargain and entering into a binding  contract.
\nAfter  negotiation of bargain in the present case, the stage
\nnever reached when the negotiations  were  completed  giving
\nrise to a binding contract.  The learned single Judge of the
\nHigh  Court  was,  therefore, perfectly justified in holding
\nthat Clause 53 of the Charter Party relating to\t Arbitration
\nhad no existence in the eye of law, because no concluded and
\nbinding\t contract  ever\t came  into  existence\tbetween\t the
\nparties.  The finding recorded by the learned  single  Judge
\nis  based on a proper appreciation of evidence on the record
\nand a correct application of the legal principles.  We\tfind
\nno merit  in  this  appeal.   It fails and is dismissed with
\ncosts.<\/p>\n","protected":false},"excerpt":{"rendered":"
Supreme Court of India M\/S Rickmers Verwaltung Gmb H vs The Indian Oil Corporation Ltd on 19 November, 1998 Author: . A.S.Anand. Bench: K.Venkataswami PETITIONER: M\/S RICKMERS VERWALTUNG GMB H Vs. RESPONDENT: THE INDIAN OIL CORPORATION LTD. DATE OF JUDGMENT: 19\/11\/1998 BENCH: K.VENKATASWAMI ACT: HEADNOTE: JUDGMENT: JUDGMENT Dr. A.S.Anand. CJI Leave granted. This appeal by […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[30],"tags":[],"class_list":["post-163031","post","type-post","status-publish","format-standard","hentry","category-supreme-court-of-india"],"yoast_head":"\nM\/S Rickmers Verwaltung Gmb H vs The Indian Oil Corporation Ltd on 19 November, 1998 - Free Judgements of Supreme Court & High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/ms-rickmers-verwaltung-gmb-h-vs-the-indian-oil-corporation-ltd-on-19-november-1998\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"M\/S Rickmers Verwaltung Gmb H vs The Indian Oil Corporation Ltd on 19 November, 1998 - 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